The Gallery: Between a Rock and a Hard Spot: Upgrading Legacy Federal IT Systems

The adage in government IT since the first computer has been “If it ain’t broke, don’t fix it” and this is especially true for the U.S. Federal government. The U.S. Government Accountability Office (GAO) released a new report that looked at Federal government IT spending, noting that in fiscal year 2015 approximately 75% of the Federal IT budget was spent on operations and maintenance, up from approximately 55% of the Federal IT budget in 2010.

Most of this spending is focused on maintaining legacy systems, such as the main IRS taxpayer database that that was written in assembly language and runs on a mainframe that is over 50 years old, or the DoD nuclear command and control system that is also over 50 years old and still uses 8 inch floppies, or the Social Security Administration system that determines retirement eligibility and benefit that is over 30 years old and runs on COBOL.

Why would the government spend 75% of its IT budget on O&M instead of new systems? Because they still work and because failure is expensive.

Compared to those of us who live on our iPhones or our Android devices and are used to having the world at our digital fingertips, these systems are antiquated and don’t make much sense to maintain until we look at the success criteria – they still work. They may not be the most modern or the fastest, and they are definitely not the prettiest but they do what they are designed to do. And to replace them is to walk into a minefield.

As David Powner, the Director of IT Management Issues at GAO, noted in testimony before the House Oversight and and Government Reform Committee in 2015 that IT investments frequently fail, can have problems that result in multimillion dollar cost overruns, and significant delays. And it is not an uncommon occurrence, with some data from the Congressional Budget Office suggesting that over 40% of Federal IT projects fail. Projects such as the Air Force Expeditionary Combat Support System that cost over $1 billion but was dropped in 2012, or the joint DoD and NASA National Polar-Orbiting Environmental Satellite System that cost $5 billion before it was discontinued, or DHS’s Secure Border Initiative that spent over $1 billion before it was abandoned, and not even mentioning the Healthcare.gov fiasco.

Who wants to be on the front of the Washington Post for a failed IT project that cost the government and taxpayers billions? No one. As an IT manager in government, with the options being A) keeping old systems up and running that still work but at a significant cost it seems; or B) Trying to bring a new system up and online with the potential for a very expensive failure, it is a “you are damned if you do and damned if you don’t” type of world. The result is that IT managers take the safest route – stick with the old that works.

So what will change this? What will push government forward? Getting slammed by GAO, Congressional committees, and the press from both directions won’t and it sure won’t encourage more people to join the ranks of IT management in government. Two things will – security and demand.

First, security will drive a significant number of changes. Most of these systems are old but crucial to the operation of government, and they lack the necessary security protections to keep other nation states, hackers, and others at bay. As was demonstrated by the OPM breach, penetration of even non-classified government systems can have a significant detrimental impact. Eventually, probably after a couple more embarrassing breaches, Congress and the Executive branch will come to the conclusion that many of these legacy systems need to be updated if for no other reason to protect and secure the data and systems.

Second, demand by consumers/citizens and businesses will also drive change. Citizens already spend a significant amount of time interacting with businesses and each other via mobile and digital platforms, so why not government? The answer is that most of government and particularly the US Federal government is nowhere near ready to be able to engage with citizens like Amazon does with consumers. But there is change coming driven by demand and competition, what IDC calls Digital Transformation (DX). We see it already among cities as they upgrade and deploy new digital ways of interacting an engaging with government while modernizing backend systems to improve efficiency and service delivery, all in the name of being a more desirable place to live and work. And this is spreading to the national level as demonstrated to some degree by countries like Korea, Australia, Estonia, Singapore, Finland, and the Netherlands. These countries along with many of the major cities have realized that upgrading and a digital transformation is critical.

The GAO report is pretty damning, but not unexpected. But the government can change. There are numerous companies, government employees, and others who stand ready to assist and support the government when the pain for the government to change becomes greater than staying the same.

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